Rusta AB (publ) Q3 2024 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Niklas Ekman - Carnegie Investment Bank AB - Analyst : Thank you. A couple of questions from my end. Firstly, can you say something about current trading? You mentioned here that you have good momentum here at the start of Q4. But is there any way you can quantify this, and do you think that you have a good chance of delivering on grow -- on like-for-like growth of at least 3% in the quarter for instance despite IT disruption? That will be my first question.

Question: Niklas Ekman - Carnegie Investment Bank AB - Analyst : Realize this, and very clear explanation. And kind of on the same topic, Q4, I note that in the last three years -- sorry, Q4, in the last three years, you've been loss making. Do you think -- and again, with the caveat that April could be both a positive and a negative, in a normal year, do you think that going forward, could you be aiming for profitability in Q4? Or will Q4 do you think always be around breakeven or below?

Question: Niklas Ekman - Carnegie Investment Bank AB - Analyst : Very clear. And just generally, if you could elaborate a little bit on the mix between sales growth and profitability. As you mentioned here now, you saw very good improvement in profitability here, not least in other markets in Finland and Germany. Whereas like-for-like growth, for instance, in those two markets was negative. Can you tell us a little bit about your thoughts on the mix here going forward? What are going to be your priorities? Now obviously, strong margin expansion here in the last few quarters, but do you see that shifting back to growth anytime soon?

Question: Niklas Ekman - Carnegie Investment Bank AB - Analyst : Very clear. Thank you. I'm going to leave it open for others soon, but just a quick one. Net financials, SEK55 million in Q3, all of that more or less related to leasing. Is that a good proxy, do you think, for coming quarters?

Question: Niklas Ekman - Carnegie Investment Bank AB - Analyst : Okay, very clear. Thank you. I'll open up for others, and I might come back later. Thank you so much for taking my question.

Question: Gustav HagTus - Skandinaviska Enskilda Banken AB - Analyst : Morning, guys. Thanks for taking my question. If I can start with the membership growth here, 20,000 new members and 700,000 last 12 months. Could you give us an indication whether or not this is partly driven also from Germany and perhaps Finland? Or is this still in your main markets that you have, the main part of that growth?

Question: Gustav HagTus - Skandinaviska Enskilda Banken AB - Analyst : Perfect. And regarding the gross margin expansion, your improved costs from procurement, could you give us an indication what type of headroom that potentially keeps you from lowering prices further as we go forward?

Question: Gustav HagTus - Skandinaviska Enskilda Banken AB - Analyst : Okay. And in terms of bargaining power, would you say that your bargaining power within procurement has strengthened due to your volume growth this year? And is that something that you think can be material as you renegotiate prices going forward?

Question: Gustav HagTus - Skandinaviska Enskilda Banken AB - Analyst : Perfect. Those are all my questions. Thanks.

Question: Simen Aas - DNB Bank ASA - Analyst : Good morning and congratulations on a very, very strong quarter. I have a few questions. So the first, just to touch upon price again, so a key element in your gross margin recovery story was actually closing the gap versus your peers in terms of price gap. But to my understanding and how you're communicating now, that is not -- you haven't been raising pricing that much. So is the gap widening because the data that we look at in the market is actually that your competitors is still raising their prices? So could you just elaborate on that and give us some more color on that? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 14, 2024 / 8:00AM, RUSTA.ST - Q3 2024 Rusta AB (publ) Earnings Call

Question: Simen Aas - DNB Bank ASA - Analyst : Yes, that's very clear. And then just on the sort of the impact of the purchasing prices, so this was the first quarter where you saw the positive impact from that? Is that correct or started already?

Question: Simen Aas - DNB Bank ASA - Analyst : Yes. And then just on that topic, the Red Sea event with the increased freight times, et cetera, could you just give us an overview of how that will impact you? And are you sort of, in terms of your spring summer goods, they are secured and you believe that you get them in time? Or is it anything that we should be aware of on that front?

Question: Simen Aas - DNB Bank ASA - Analyst : Okay, that's very clear. And then just one final one in terms of, could you just give us some color on the performance in Finland and Germany, just on which performed best and which performed worse, which was most impacted by the IT issues? And then some color on that would be very helpful. Are you in black figures in both markets? Or is it Finland that is contributing positive here?

Question: Simen Aas - DNB Bank ASA - Analyst : Okay, thank you. That was very clear. And that was all for me, so I'll jump back in the queue.